Porterhouse Company Has Both Fixed and Variable Production Costs

question 7

Multiple Choice

Porterhouse Company has both fixed and variable production costs.If volume goes up by 20%,how would that affect the total of all costs? (Assume all volumes are within the relevant range.)

• A) Would go down
• B) Would go up 20%
• C) Would remain the same
• D) Would go up by some amount less than 20%

---

Definitions:

Stable External

Refers to consistent, external conditions or factors that do not change significantly over time.

Incremental Mind-Set

A belief that abilities and intelligence can be developed through effort, strategies, and persistence.

Entity Mind-Set

The belief that personal qualities are fixed and cannot change, as opposed to a growth mindset that views abilities as developable with effort.

Particular Attribute

A specific quality, trait, or characteristic that distinguishes someone or something from others.